First exploration well in program to be drilled in 2011
CALGARY, Sept. 15, 2011 /PRNewswire/ - Gran Tierra Energy Inc. ("Gran Tierra Energy") (NYSE Amex: GTE, TSX: GTE), a company focused on oil exploration and production in South America, today announced that it has entered into two farm-in agreements with Statoil do Brasil Ltda. ("Statoil"), whereby Gran Tierra Energy will earn a 10% working interest in Concession Contract BM-CAL-7 operated by PetróleoBrasileiro S.A. ("Petrobras"), and a 15% working interest in Concession Contract BM-CAL-10 operated by Statoil, in the offshore Camamu-Almada Basin, Brazil. The completion of the two transactions is subject to obtaining regulatory approval from Agência Nacional de Petróleo, Gás Natural e Biocombustíveis ("ANP") and other customary conditions of closing.
"The conclusion of these farm-in opportunities will establish Gran Tierra Energy in offshore Brazil, one of the most important petroleum regions in the world today. Partnering with Petrobras and Statoil will provide Gran Tierra Energy with an opportunity to participate in multiple highly prospective exploration plays with two world-class offshore operators experienced in those plays" said Dana Coffield, President and Chief Executive Officer of Gran Tierra Energy.
BM-CAL-7 encompasses approximately 1,362 square kilometers (336,558 acres), and BM-CAL-10 encompasses approximately 1,680 square kilometers (415,137 acres); water depths range from approximately 400 to 2,800 meters. Multiple leads and prospects have been identified on the two blocks.
The Camamu-Almada Basin lies immediately south and offshore from the onshore Recôncavo Basin, where Gran Tierra Energy is the operator of four blocks and is poised to begin both development drilling and exploration drilling operations.
Under the terms of the farm-in agreements, Gran Tierra Energy will be a non-operating partner and will pay its participating interest share of costs incurred to date and in the future on the Concession Contracts as well as a carry on the drilling of the first exploration obligation well with respect to Concession Contract BM-CAL-7 and Concession Contract BM-CAL-10. Additional amounts may also be payable in the event one of the first exploration obligation wells results in a discovery and in the event of future development. The Gran Tierra Energy 2011 budget impact is expected to be US$17 million.
The first exploration well on Concession Contract BM-CAL-10 is anticipated to be drilled late 2011.
"Similar to what we have done successfully in the other South American jurisdictions in which we operate, Gran Tierra Energy is today building a portfolio of different types of drilling opportunities in Brazil, ranging from established onshore exploration and production operations in the Recôncavo Basin, to higher reward offshore operations in the Camamu-Almada Basin, exposing the company to diverse and substantial growth opportunities for the future. We look forward to obtaining the required regulatory approval from the ANP and to participation in the Concession Contracts with Petrobras and Statoil," concluded Coffield.
About Gran Tierra Energy Inc.
Gran Tierra Energy is an international oil and gas exploration and production company, headquartered in Calgary, Canada, incorporated in the United States, trading on the NYSE Amex Exchange (GTE) and the Toronto Stock Exchange (GTE), and operating in South America. Gran Tierra Energy holds interests in producing and prospective properties in Colombia, Argentina, Peru, and Brazil. Gran Tierra Energy has a strategy that focuses on establishing a portfolio of producing properties, plus production enhancement and exploration opportunities to provide a base for future growth.
Gran Tierra Energy's Securities and Exchange Commission filings are available on a web site maintained by the Securities and Exchange Commission at http://www.sec.gov and on SEDAR at http://www.sedar.com.
Forward Looking Statements: This news release contains certain forward-looking information and forward-looking statements (collectively, "forward-looking statements") under the meaning of applicable securities laws, including Canadian Securities Administrators' National Instrument 51-102 - Continuous Disclosure Obligations and the United States Private Securities Litigation Reform Act of 1995. The use of the words "expects", "expected", "anticipated", "targeting", "estimated" and "will" identify forward-looking statements. In particular, but without limiting the foregoing, this news release contains forward-looking statements regarding Gran Tierra Energy's planned and expected presence in Brazil, the benefits it expects from the Concession Contracts, the timing and duration of drilling the exploration wells, and the expected impact the contracts will have on its 2011 budget.
The forward-looking statements contained in this news release reflect several material factors and expectations and assumptions of Gran Tierra Energy including, without limitation, assumptions relating to field size and recoverability in the Camamu-Almada Basin. Gran Tierra Energy believes the material factors, expectations and assumptions reflected in the forward-looking statements are reasonable at this time but no assurance can be given that these factors, expectations and assumptions will prove to be correct.
The forward-looking statements contained in this news release are subject to risks, uncertainties and other factors that could cause actual results or outcomes to differ materially from those contemplated by the forward-looking statements, including, among others: the transaction is subject to regulatory approval by AgenciaNacional de Petroleo Gas Natural e Biocombustiveis, the timing and results of which are outside of Gran Tierra Energy's control, which approval if not obtained or delayed could cause the transaction not to occur or to be delayed; unexpected technical difficulties and operational difficulties may occur, or the obtaining of environmental permits may be delayed, which could impact or delay the commencement of drilling exploration wells; geographic, political and weather conditions can impede testing, which could impact or delay the commencement of drilling exploration wells; and the risk that current global economic and credit market conditions may impact oil prices and oil consumption more than Gran Tierra Energy currently predicts, which could cause Gran Tierra Energy to not realize the benefit that it expects from the contracts. Further information on potential factors that could affect Gran Tierra Energy are included in risks detailed from time to time in Gran Tierra Energy's Securities and Exchange Commission filings, including, without limitation, under the caption "Risk Factors" in Gran Tierra Energy's Quarterly Report on Form 10-Q filed August 9, 2011. These filings are available on a Web site maintained by the Securities and Exchange Commission at http://www.sec.gov and on SEDAR at www.sedar.com. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included in this press release are made as of the date of this press release and Gran Tierra Energy disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities legislation.
SOURCE Gran Tierra Energy Inc.